Why EOS Skyrocketed 78% This Week

The cryptocurrency market has been pretty active this week with some major upside movements and corrections taking place throughout the week, but EOS stands out with a whopping 78% gains in seven days according to coinmarketcap.

The dApp-focused cryptocurrency currently ranks as the 5th largest token by market cap and is riding a wave of positive investor sentiment driven by the recent launch of EOS Dawn 3.0, a notable venture partnership announcement, and the upcoming launch of the EOS mainnet.

EOS Moves Toward Mainnet Launch

EOS’ impending mainnet launch is a major driver in the token’s recent positive price movement and is scheduled for the 2nd of June. On the 2nd, EOS will migrate from the Ethereum network to its own blockchain over the course of 40 days.

The transition to the EOS blockchain is set to deliver a wide range of benefits to the token, the most notable of which is transaction speed. Any transaction conducted with ERC20 tokens must be confirmed by the Ethereum network, which currently supports roughly 15 transactions per second.

When EOS moves to its own blockchain, however, the EOS development team claims that it will offer dramatically faster transaction speeds.

As outlined in a recent EOS Medium post, worst case predictions of transaction speed place EOS at 1,000 TPS with average and best case scenarios delivering speeds of between 3,000 and 6,000 transactions per second, which would make EOS one of the fastest blockchains by transaction speed.

Theoretical calculations predict transactions speed of millions of TPS, which would hypothetically place EOS above Visa and Mastercard in terms of transaction throughput.

Highly popular exchange Binance has recently announced their support of EOS’ mainnet launch in a recent blog post:

“Binance would like to confirm that we will support the EOS MainNet Token Swap. We will handle all technical requirements involved for all users holding EOS.”

The EOS mainnet launch will also make available a range of features not currently implemented on the ERC20 version of the token. The launch will enable dApp development and integration, a fact that has been highlighted by the recent EOS Hackathon.

EOS has recently invited developers to introduce themselves and their project in order to share in a chance to win a travel stipend of $2,000 USD to the upcoming Hong Kong hackathon. At the event, EOS intends to connect hackers, developers, marketers, businesses and other blockchain entities in order to foster development and growth within the EOS dApp ecosystem.

Block Producers Registrations Intensify

As part of their mainnet launch process, the EOS development team have been accepting registrations form organizations that seek to capture a position as one of 21 “Block Producers” that will contribute to the maintenance of the EOS blockchain.

The registrations, which are recorded on the EOS GO blog, includes over 50 different registrants. Some applicants are groups of EOS enthusiasts that are locally assembled, such as EOS Canada or EOS Rio, while others are significant industry players such as AntPool and Bitfinex.

The Block Producers positions on offer will perform a critical function in the EOS delegated proof of stake consensus mechanism. Block Producers are to be elected by EOS community members and will be tasked with accruing, processing, and mining transactions. Block Producers are also responsible for ensuring that blocks formed through this process are rebroadcast to the minor nodes present within the network.

The EOS framework only makes room for 21 Block Producers, so competition for the positions is intense.

As such, organizations seeking to take a role as an EOS supernode have made significant promises toward the development of the ecosystem.

AntPool, BitMain’s mining arm, has recently promised 2,000 servers toward the maintenance of the EOS network, while venture capital firm OK Blockchain Capital has submitted a proposal as part of its application that includes an investment fund of over $100 million toward the development of EOS-based projects and dApps.

Bitfinex has also made a number of promises in order to promote their candidacy, promising “around-the-clock, military-grade security,” in a recent blog post:

“Our underlying goal is to grow the open-source nature of the decentralized digital asset space, achieved through intensive community development, research and collaboration. Our vision as a block producer is that of a collaborative incubator, combining the potential of EOSIO with our experience to take research, development and adoption to another level.”

VC Partnership Establishes EOS Global Joint Venture

The upcoming launch of the EOS mainnet is not the only news that has contributed positive token price movement over the last month. At the beginning of April, EOS announced a new partnership between blockchain and VC veterans Winnie Liu and Michael Cao and Block.one — the developers behind the EOS software — that will result in the creation of EOS global, a $200 million joint venture fund.

The newly-formed joint venture is intended to make strategic investments in Asia-focused projects that use the EOS ecosystem. Block.one CEO Brendan Blumer has stated that the new investment fund will assist EOS in expanding their global presence:

“Block.one is delighted to welcome investment from Michael and Winnie’s fund that will leverage EOSIO to catalyze the transformation of the digital assets space in Asia. EOS VC is expanding its global reach through divers partners poised to offer EOSIO projects unprecedented international access.”

The capital injection is one of several recent large-scale VC investments into the EOS project, which include partnerships with Finlab AG, Galaxy Digital, and Tomorrow Blockchain Opportunities. The total amount of VC captured by the EOS VC program now totals in excess of $600 million, which has given the development team a boost in their roadmap progress and provided investors with a significant amount of confidence in the project.

How Will the EOS 1.0 Launch Impact Token Values?

The upcoming EOS mainnet launch is likely to have a positive impact on token values. Historically, the launch of unique blockchain mainnets has been accompanied by a significant price increase as the market observes the fruition of a lengthy development process.

As EOS is primarily driven by dApps, however, it may take some time for the market at large to respond to the mainnet launch of the token.